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Analysis

Unsubsidized Population 'Fleeing' Individual Health Insurance Market, Verma Says

By Steven Porter  
   August 13, 2019

Reports released by CMS show that the number of people paying full-price for their individual health insurance market is declining.

Enrollment in the individual health insurance market continued to decline last year, especially among those who pay full price for their coverage, according to a report released Monday by the Centers for Medicare & Medicaid Services.

After average monthly enrollment in the individual market rose 7% from 2015 to 2016, it fell 10% in 2017 and another 7% in 2018, according to the CMS report. Unsubsidized beneficiaries accounted for 85% of the enrollment decline in 2017 and all of the enrollment decline in 2018, which was offset by a small increase in subsidized enrollment, the report states.

While some states saw unsubsidized enrollment drop by less than 1%, others saw more dramatic changes, including six states where unsubsidized enrollment declined by more than 70% between 2016 and 2018, according to the report. Nationwide, unsubsidized enrollment dropped by 40%, or 2.5 million people, during that period.

CMS Administrator Seema Verma said the numbers demonstrate what the Trump administration has been saying all along: that the Affordable Care Act has been an utter disaster.

"As President Trump predicted, people are fleeing the individual market," Verma said in a statement. "Obamacare is failing the American people, and the ongoing exodus of the unsubsidized population from the market proves that Obamacare's sky-high premiums are unaffordable." 

The CMS statement notes that unsubsidized enrollment declines coincided with average monthly premium increases of 21% in 2017 and 26% in 2018.

Despite concerns over affordability, Cynthia Cox, a vice president at the Kaiser Family Foundation, reportedly said she isn't terribly concerned about the individual market's stability, as long as the current law remains in place.

"Even in the absence of the individual mandate penalty, the ACA subsidies have helped keep enrollment higher than it was before the ACA," Cox told Politico's Dan Diamond.

In addition to the report on trends in subsidized and unsubsidized enrollment through 2018, CMS released an early report Monday on effectuated enrollment for 2019. It shows that 10.6 million consumers had effectuated coverage through the ACA exchanges as of March 15, meaning they selected a plan, paid their first month's premium (if applicable), and had coverage in February. This year's number is less than a percent lower than the effectuated enrollment CMS reported last year.

Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.

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